Data security fears preventing older borrowers from seeking mortgages online

Older borrowers could be missing out on the best mortgage and equity release deals through fears about the security of their data, according to new research from Contact State.

Related topics:  Later Life,  Mortgages
Rozi Jones
30th September 2022
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"Concerns about data is creating a real disconnect between over 55s and mortgage and equity release brokers who rely on online channels for their leads."

Its data shows that just 9% of over 55s went online to get their last mortgage or equity release quote – compared to 17% overall – and two thirds (63%) went with the first quote they got.

Contact State’s research of 5,000 UK Adults suggests that one of the key factors in over 55s’ reluctance to go online to compare deals is concerns about who has access to their data once they do. Overall, three-fifths (62%) of over 55s say they have reservations about sharing personal and financial details online to get a mortgage quote, including 30% of over 55s who have reservations when it comes to sharing phone number. And this is perhaps understandable when you consider 73% of over 55s have been targeted by cold callers over the past year – almost half of these (30%) have been called more than 10 times. For 58% of over 55s, receiving cold calls left them feeling angry - especially given that most (63%) say they have no idea how the caller got their number.

One in seven (15%) of over 55s feel they have been forced to share their data online when looking for a financial product such as a mortgage or insurance and 52% said that when they do share their data online, they are not confident they know who has access to it. One in eight (13%) over 55s have had a ‘negative experience’ – when getting a financial product or professional service online, and again, the top issue in relation to this is unwanted phone calls, specifically, ‘being contacted by a company other than the one I submitted my details to’. This particular issue is of huge concern to older borrowers, 84% of whom say they’d be unhappy if they submitted their details to one company, and were called by another, while 96% said they would be worried about the security of their data if this happened.

Other top issues were the fact that financial product or service pages are not clear enough – just over one in five (22%) over 55s who had a negative experience when getting a quote said ‘I wanted an online quote but was called instead expected’ while 19% said ‘it was unclear that I would have to submit details to receive a quote’. It is perhaps then no surprise that 39% of over 55s are less willing to share their data online that they were five years ago, and despite the huge shift to online, more than two thirds (69%) would still not go online if they wanted to remortagage now.

While just 9% of over 55s got their last mortgage online, 31% would start their search online next time, and Contact State says this offers a huge opportunity for brokers to win new business, but warns that those getting it wrong could find themselves on the wrong side of the FCA.

Thomas Brett, head of mortgages and lending at Contact State, said: “Our findings suggest that concerns about data is creating a real disconnect between over 55s and mortgage and equity release brokers who rely on online channels for their leads. And it seems those concerns are well justified, given so many older borrowers have had negative experiences, particularly when filling in a form or calculator online, and expecting to get a quote from one company, and then finding they are being called by someone else.

"The trouble is, these online forms and calculators are how so many mortgage and ER brokers get their leads, and if over 55s are having negative experiences using them, they are much less likely to buy when they do eventually get put in touch with someone who can help.

“There are clear opportunities here, but if brokers are buying data or leads from a source they don't understand, and the customer has had a negative experience getting to them, not only are the less likely to buy, but as the buyer of that lead, the mortgage firm/broker could well be in breach of the Consumer Duty.”

Alain Desmier, managing director of Contact State, added: “Our research highlights just how serious the issues around data and consent are, and the negative impact it is having on people. At Contact State, we are working hard with lead generation buyers and sellers across the UK to clean up the industry, creating a clear and transparent customer journey so firms know exactly how that customers’ number was obtained to help ensure ‘how did you get my number’ becomes a question of the past.”

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